40 Indian startups slated to go public or be IPO-ready by FY25: Redseer

economictimes.indiatimes.com:

startups or new-age firms could go public or be ready to trade their shares on bourses by financial year 2025 as the ecosystem has turned its focus on profitability, a report from consulting firm Redseer showed. The focus on profitability has come amidst a prolonged funding winter for Indian startups.

The report estimated that by FY28, there will be a significant increase in the number of companies that are either listed or ready for an IPO, with a strong emphasis on profitability. The report comes a day after consumer brand Mamaearth's parent firm secured Sebi approval for its planned IPO, and food and grocery delivery firm Zomato recording its first-ever quarterly profit (of Rs 2 crore) during the June quarter.

Despite facing challenges and macroeconomic headwinds, Indian startups have been resilient, leading to a substantial pipeline of IPO-ready companies for the next five years, said Rohan Agarwal, partner at Redseer. “Listed new-age tech players bounced back after a period of sharp correction in stock prices until the last quarter of FY22, signalling a gradual recovery.

By FY28, listed or IPO ready new-age companies are expected to reach 90,” added Agarwal. In FY24, startups have notably improved their profitability, with a promising outlook projecting around 50% of Indian unicorns turning profitable by FY27.

Compared to FY21, nearly twice the number of Indian unicorns are on track to achieve profitability by FY23, Agarwal added in the report. However, not all unicorns are likely to thrive, as the report suggested that around 20% of them might face difficulties due to regulatory challenges, plummeting demand, and unclear business models.Tech IPOs: Unlocking potential The report highlighted the untapped potential